Before investing in Hong Kong-listed H shares, we need to watch closely what senior Chinese government officials are saying. Xi Jinping, who will formally become the country's new president next month, is keen to weed out corruption and extravagance.

Recently, advertisements for expensive gifts such as watches, wine and gold coins were banned in mainland TV and radio commercials.

Luxury product manufacturers would be penalized if they advertise.

Liquor such as Kweichow Moutai fell at least 30 percent as nobody dared send gifts to senior officials during Chinese New Year. A government official, who drank 12 bottles of expensive red wine with his friends during a meal, posted some photos and message on his internet chat. He was promptly sacked.

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The corruption crackdown has also hit jewelry, watch and wine retailers.

In Hong Kong, those shops targeting big spenders from the mainland would be seriously affected.

On the other hand, exorbitant rents for retail space show no sign of falling.

Do not try to catch the falling knife when their share prices are dropping. Dr Check and/or The Standard bear no responsibility for any investment decision made based on the views expressed in this column.